—-So…the president inadvertently rolled back his “fibs” on tariffs yesterday as he abruptly changes his mind on very important products. In his own words, he states that he is worried about the costs to consumers during the holidays because of the tariffs. Again, tariffs are paid by the importing business who has a choice to eat the cost or pass it on to consumers. Case closed.—-
—–We do not pretend to be Milton Friedman but we do think we have a pretty good feel for what is going on in the economy, not only here but around the globe. For the past year, we have stated we are much more worried about Europe and Asia. The worries are coming to fruition as for starters, Germany is now looking to be in contraction mode. Due to the fact that Germany is perceived to be the engine of Europe, it begs the question what about the rest of Europe? China? We don’t believe a word that comes out of China on their numbers but leave no doubt, their economy has been heading south.—–
—–This leads us to the U.S. economy. Our stance has not changed. We have believed growth was slowing but not to the point of real trouble. We are now entertaining trouble. We suspect the slowing of global growth is affecting. We suspect the confusing and ever-changing policy of this president is affecting. We suspect the diminishing effect of central banks is affecting. We suspect the asinine, asiten, aseleven out of control government debt is affecting. (Did you hear that Kudlow…who used to abhor debt and deficits but now thinks they are no big deal?) Stay tuned. The bond market is now screaming at the top of its lungs that softness lies ahead. These interest rate moves should not be shrugged off. ——
——The president, for the umpteenth (don’t even know if that’s a word) time, changed his mind abruptly yesterday. Markets jumped on the latest change of stance. But to our eyes, we suspect there is more time and price for this correction. How long? Don’t know. How bad? Don’t know. We just believe the upside is limited here as foreign markets act terrible and our market remains below resistance with many areas in their own private bear markets. At the very least, we suspect things will remain “mushy!” If at any time the big 4 large cap indices break below the 200 day moving average, look out as that will only invite some serious institutional selling as they recognize another important level has been given up. So far, just a less than thrilling correction.—–
—–We have been to Hong Kong on more than a few occasions. It really is one of the great cities of this world. Do not underestimate the seriousness of what we are all seeing in real time. We keep our fingers crossed for the best but fear the worst as China is showing they want to take over in every way, shape and form, 28 years before “the deal” between the two was set to expire. —–
—–Next up…more rate cuts! Yipppeeee!—–


—-Mr. Bluster strikes again.—-
—-We have taken some heat in recent weeks when we take on this president for changing his mind based on the market and its moves. Sorry! We do not want a president who would change economic policy off of a few percent to the downside. You don’t believe us? How many times were new tariffs going to be put on China only to be taken off? How about those European auto tariffs that were taken off 4 days before they were supposed to go in effect without any negotiation? How about those tariffs on Mexico that went away after a few days? We have stated that we expected the latest round of tariffs to go into effect on September 1st…NOT to go into effect. Just look at past performance.—-

—–“””The United States Trade Representative (USTR) today announced the next steps in the process of imposing an additional tariff of 10 percent on approximately $300 billion of Chinese imports. On May 17, 2019, USTR published a list of products imported from China that would be potentially subject to an additional 10 percent tariff. This new tariff will go into effect on September 1 as announced by President Trump on August 1. Certain products are being removed from the tariff list based on health, safety, national security and other factors and will not face additional tariffs of 10 percent. Further, as part of USTR’s public comment and hearing process, it was determined that the tariff should be delayed to December 15 for certain articles. Products in this group include, for example, cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing. USTR intends to conduct an exclusion process for products subject to the additional tariff.  The USTR will publish on its website today, and in the Federal Register as soon as possible, additional details and lists of the tariff lines affected by this announcement.””””—–

—–Health, safety, national security and other factors? We are not stupid Mr. President! This has nothing to do with health, safety, national security and other factors. The president, once again, backed away from new tariffs because of market deterioration.—–

—–We are not complaining about this move. We hate tariffs. And yes Mr. president, business and consumer pay for the tariffs. Why do you think you paid off the farmers with $28 billion of our tax dollars? We are complaining because we cannot stand policy based on market movement. This is not ordering carpet and tile for hotels. There will come a day where this becomes a “boy who cried wolf” market. There will come a day where markets have had enough with this “Sybil”-like economic policy which changes with market winds. There will come a day where markets do not believe a word that comes out of this president’s mouth.—–

—–On cue, markets get back what they lost yesterday…and more. Technology leads today as technology was just excused from detention. APPLE (AAPL) rallies up 5% immediately. (Would like to see Tim Cook’s phone logs as we are sure he has been talking to the president on this.) The good news is that the President backed away from stupidity. The bad news is that one day the market will not trust a word from Mr. Bluster and then watch what happens with markets.—–






Uh…yesterday was a bad day.

Yesterday, the big 4 indices could not get back above the 50 day and now look headed towards the 200 day.

The 200 day had better hold.

China/Hong Kong is a problem. We are with the people of Hong Kong but not when they shut down the airport. They only hurt themselves. We worry about a disproportionate response by the Chinese government.

Argentina is a problem. In early primary, pro-business dude not good…socialist makes big headway. Go look at AGT. A big wow.

Fewer and fewer names working. More and more names breaking first line of support.



We might as well wait until every morning before posting here as so many things change overnight.

Hong Kong airport closed down. This affected our open. Why? Beats the heck out of us.

Markets here are simple…becoming messy. Fewer and fewer names working. More and more names rolling over. Foreign markets remain much weaker. Small and mid caps continue to lag the large caps badly. Transports still not happening. Many areas like oils, retail remain bearish.

Major indices have taken on water recently. Just a good time to take a step back. There are still a decent amount of leaders just less so.

Yields continue to come down, notwithstanding bounces. We continue to ask what is wrong when $13 trillion of debt is negative, many economies starting to contract even with those negative rates…so we pay attention.

Bigger indices will open below their 50 day average today. That must change before anyone can get excited.

GOLD/GOLD STOCKS/SILVER/SILVER STOCKS remain strongest but only on pullbacks or settling down.


They say here in Orlando that we have some of the greatest roller coasters in the world as Orlando does have quite the few amusement parks. But they have nothing on this market, nothing on a tweeting president, nothing on a central bank as they continue to move markets on a dime. Markets used to have a decent ebb and flow. Not any more. Washington DC has assured that. This morning, it is the Huawei thing. Up next?????????????????????

Two more thoughts…UBER…that was some crappy numbers and one thing not highlighted…continued deceleration of sales.

THE METS…3 above .500 and 1 behind wild card.


The script continues. Every time markets get in trouble, the fed starts the easy money rhetoric. If it doesn’t work a first time, try a second time. Two days ago, it was Bullard. Yesterday, it was Evans. None of this is by accident.

Here is  how we believe this plays out:

If markets ignore the 2nd attempt by the fed to stanch the bleeding, we suspect there will be a louder attempt at rhetoric, maybe something to the effect of using the word “imminent!” If that doesn’t work, expect them to take action before the next meeting. After all, it should be evident now it is all abpout the markets for these people. After all, the meeting is Sept-25-26…a long way away. They will not wait that long if markets do not cooperate.

If markets do cooperate with the fed rhetoric, they will be able to wait but it is a mortal lock of  rate cuts at the September meeting. Just keep in mind, if rates stay where they are in the market, a rate cut is meaningless as the market is way head of the fed…or putting it better, the fed is way behind the market.

As far as yesterday, just an very very very oversold market rally. We were oversold but foreign markets a lot worse. Emerging market stocks have been bludgeoned. They have to bounce somewhere. At this juncture, we will know more on how this bounce plays out. If it fails quickly, not good.

As far as rates, the bond bubble may be in the climactic stage. This occurs when maniacal investors buy longer term bonds yielding negative…only to make money on capital gains…AFTER a gigantic bond market run. We also have to mention Austria was able to float a 100 year bond…at 1.2%. Repeat…100 years at 1.2%. But don’t worry, Powell tells us there are no bubbles.